HMV set their loss prevention record straight

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Sector: Retail Non-Food

Region: United Kingdom

No. Of Outlets: 50+

With many retailers in the UK still losing the costly battle against cash shrinkage, HMV, the world’s premier retailer of music, videos and computer games, bucking the loss prevention trend.

Recent surveys have indicated that UK retailers are losing £1.5 billion a year, derived from internal theft (49%), external theft (18%) genuine handling errors till point (14%) and genuine handling errors during cashing up (9%).

In light of current trends, HMV have teamed up with Cashmaster International to implement a fully integrated, highly intelligent, cash management solution, now in the final stages of its rollout across their stores in the UK and Ireland.

HMV’s brief was simple - a very efficient, fully reconcilable method of counting cash and other payment media in each of their 225 stores across the UK and Ireland, a brief that Cashmaster revelled in accepting.

Cashmaster, the innovative Scottish manufacturer of cash counting machines, worked closely with HMV’s technical team on a dual phase project to develop truly bespoke turnkey solution, capable of two way communication (via a network), enhanced reconciliation and functionality.

Phase One of the project was heavily biased towards the development of communications software - the aim being to connect each counting machine, in every HMV store, via their existing network. Once networked, every count would then be visible to the Head Office data warehouse, with details such as which member of staff made the count and, crucially, at what time, on hand for analysis. The advantages of this system are two fold for HMV in that they can instantly compare cash counts with till totals. Like the Cashmaster counting machines, HMV's tills are connected to the same network, and also send data back to Head Office, which allows them to immediately identify discrepancies between the two. In essence, their reconciliation is now automated and fully verified the spot.

Phase Two of the project was concerned with creating a bespoke data protocol for HMV, allowing them to define exactly how they wanted the machine operate, with reference to counting order, user interface and other functions, such as banking frequencies. Cashmaster worked with HMV to develop multiple modes of operation, providing a machine, which would offer date and time sensitive till pulls and deposit pick ups for both tills and safes. A wide range additional HMV specific payment types, such as sales and gift vouchers, were also added to allow the machine to handle all types of payment media.

Following the development programme, the first test machines were piloted at five leading HMV stores in August 2005, with overwhelming success.

Andy Jones, HMV’s Central Loss Prevention Manager, and Bill Hamilton, Cashmaster’s Engineering Director, are in full agreement regarding the project’s achievements, with the final rollout now allowing every HMV store to take advantage of the new technology.
‘The Cashmaster system enables us to record electronically a number of essential control checks within our Cash offices. This data can then be used to assist our Loss Prevention field team when targeting store visits. In addition the reduction in data input saves cashiers on average 1.5 hours a day’ explained Andy Jones.

Bill Hamilton went on to explain, ‘Whilst the technical challenges of the project cannot be underestimated, the end product is a fantastic solution, which provides HMV with a very robust, powerful tool and is testament to how we work with our customers. Our in house software team worked very closely with HMV to develop a system, which is second to none in this field, but most importantly, more than satisfies their original requirements’.

Key to its success is how cash handling has now become transparent at HMV, allowing areas of cash shrinkage, such as internal fraud or handling errors the till point, to be identified and remedied quickly.

The Cashmaster machine carries out till reconciliation and till re-floating in one operation. It then allows the user to review any till differences before final acceptance of the data. Input errors can be amended. All the information is available for viewing and checking before final bankings are carried out

Andy Jones

Reconciliation isn’t the only benefit Cashmaster machines offer HMV. ‘It’s an old adage, but time is money, so increasing the time HMV can spend with their customers, through reducing the time they spend counting their cash, provides a powerful, no nonsense return of investment. Our cash counting machines are very versatile - it’s a simple concept, take the cash out of the till, place it on the machine and it counts it... hardly rocket science, but the results speak for themselves. However, working with a customer like HMV has allowed us to tailor our hi-end machine to their specification, to produce a powerful machine which tackles cash and time losses in one,’ said Christopher Howroyd, Cashmaster’s Product Development and Marketing Manager.

On average, a Cashmaster machine can count the entire contents of a typical till in less than one minute, that’s 6 times faster than by hand - and with mistakes, removing yet another possible cause of shrinkage. Counting more than 500 coins in 0.2 seconds and 300 notes in 5 seconds, HMV save over hours a day across their UK stores, a saving which allows their staff to concentrate on more value added, customer focussed activities.

Unlike the vast majority of their competitors, Cashmaster’s machines count by weight, offering many advantages over friction counting methods, including enhanced accuracy and improved reliability/durability. At the heart of their machines lies an embedded intelligent microchip, which is continuously learning. Cutting edge load cell technology, combined with intelligent software, allows Cashmaster’s machines to function without any moving parts, meaning reliability is assured.

Cashmaster has pledged to remain technology focussed, in a vow to continue to exceed HMV’s current needs, and is looking forward to working with them again in the near future.